APECOIN has had some success in its early trading days – but you need to be aware of risks when it comes to coins like these.
In the past 24 hours, the price of the cryptocurrency has climbed 15% to $12.27, according to CoinMarketCap.
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While there’s been some success, keep in mind that ApeCoin is down 69% from its peak on its first day of trading on March 17.
The risks
The first thing you need to be wary about is buying too high – especially when it comes to newer cryptocurrencies like ApeCoin.
Sometimes, a lot of euphoria will come out from investors during the first few days of trading.
What they might do is buy it – hoping the price surges – and then cash out with their profits before it potentially crashes.
Moreover, Keegan Francis, a Bitcoin and crypto specialist at Finder noted that ApeCoin is a meme coin, which typically gains off social media-based jokes.
Some examples of meme coins include Dogecoin and Shiba Inu.
“There is only as much value in the token as the project administrators can build into and around it. That and the amount of hype that is generated around it in social media,” he told The Sun.
Keep in mind that meme coins can tumble at any point, should the community lose interest.
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As exemplified with ApeCoin, you could lose a significant amount of money if you’re not careful.
Another thing you need to be wary of is the extreme volatility cryptocurrencies are subject to.
Cryptocurrencies could rise or plunge rapidly with little or no notice.
For example, many coins have slumped this year on fears of inflation and Russia’s invasion of Ukraine.
Lastly, ApeCoin does not have a proven trading record like giants in the industry including Bitcoin and Ethereum.
What is ApeCoin?
Despite the warning signs, ApeCoin does have a few things that stand out.
The cryptocurrency was airdropped to prominent non-fungible token (NFT) collection Bored Ape Yacht Club and Mutant Ape Yacht Club.
For context, celebrities including artists Eminem and Justin Bieber have bought Bored Ape’s NFTs.
Importantly, ApeCoin describes the APE Foundation as the “steward” of the token.
The foundation, which is managed by ApeCoin DAO, has its governance community-led and decentralized.
“The goal of the APE Foundation is to steward the growth and development of the APE ecosystem in a fair and inclusive way,” ApeCoin said on its website.
“It utilizes the Ecosystem Fund, which is controlled by a multisig wallet, to pay its expenses as directed by the ApeCoin DAO and provides an infrastructure for ApeCoin holders.”
Under the DAO, all token holders are members – meaning they can weigh proposals from the community and vote on them.
Price prediction
While trends can be tough to forecast, Mr Francis calls ApeCoin a “memecoin pump” and recommends avoiding the token if you’re a retail investor.
“Apecoin looks a lot like DOGE and SHIB,” he said
“So in the short term, there could be a large momentum trade leading to much higher prices.
“But in the long term, and after the hype has subsided, I think APE will decrease substantially in value.”
Some are more bullish than others.
For example, PricePrediction sees ApeCoin averaging $18.61 this year, before jumping to $27.30 in 2023.
By 2023, the crypto forecaster predicts the price will skyrocket to an average of $580.55 in 2031.
Meanwhile, Wallet Investor sees ApeCoin falling to $10.377 a year’s time.
We recently did a price prediction for JasmyCoin.
We’ve also done price predictions on Tezos, Bitcoin, Ethereum, Dogecoin, Shiba Inu, and Sandbox.
Plus, a crypto scam recently involved a user losing $300,000 worth of Bitcoin after thinking she’d found love on a dating app.
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